The recent survey from JP Morgan’s Nutmeg highlights a clear trend: UK adults are focused on living longer, healthier lives, with 51% prioritising physical longevity compared to just 9% focusing on financial longevity. People are actively boosting their wellness—44% are striving for 10,000 steps a day, 30% are investing in supplements, and 16% are following specialist diets. But here’s where the study misses the mark.
While it paints a picture of people neglecting their financial health, it overlooks a key truth: investing in human capital is actually giving your financial future the attention it needs.
Here’s a bullet point summary of the research:
- Physical vs. Financial Longevity: UK adults are five times more likely to prioritise their physical longevity over their financial longevity (51% vs. 9%).
- Balanced Concerns: While the focus is more on physical health, worries about financial health are close behind (48% vs. 42%).
- Steps for Physical Well-being: Many people are taking active steps towards improving their physical health:
- 44% aim for 10,000 steps daily.
- 30% invest in dietary supplements like protein shakes.
- 16% follow a specialist diet.
- Neglecting Financial Health: Financial longevity doesn’t receive the same attention:
- Only 16% use financial apps weekly for budgeting.
- 20% don’t know how much they contribute to their pension each month.
- 61% have never consulted a financial adviser.
- Tracking Physical vs. Financial Health: People are twice as likely to track their steps (37%) as they are to track their pensions or investments (18%).
- Reflecting on Future Wealth: Over a third (37%) would advise their younger selves to think about their future wealth the same way they do their future health.
- Importance of Planning: 44% believe that having a pension or savings plan is as important, if not more important, than having a gym membership for a longer, fulfilling life.
- Financial Planning and Longevity: As we aim to live longer, healthier lives, it’s important to plan financially for the lifestyle we want to enjoy.
- Survey Size: The research is based on a survey of 2,015 people.
- Pension Awareness Week 2024: This study comes as part of Pension Awareness Week (9–15 September), a campaign encouraging people to think about their financial future.
Each of these points reflects how we can balance both physical and financial well-being for a secure and fulfilling future, but without reference to human capital development. Here is why this omission is a key for solving the riddle.
Why We Need Human Capital Awareness
Human capital is your ability to earn, grow, and remain productive, and this is what truly supports financial longevity. It’s not just about knowing your pension contributions. It’s about knowing your capacity to earn and, crucially, your opportunity to continue earning well into old age. The study might suggest people aren’t paying enough attention to pensions or seeking financial advice, but let’s face it—many advisers are more focused on managing assets than helping you develop your human capital.
Financial planning shouldn’t just be about tracking your pension pots or investments. It’s also about tracking your health, productivity, and earnings. After all, your future wealth doesn’t just come from what’s sitting in a savings account. It’s about the amount you can earn, how your earnings can grow over time, and how resilient those earnings are in the face of life’s ups and downs. In truth, human capital—your skills, knowledge, health, and energy—is a much larger contributor to total wealth than financial capital ever could be.
Let’s be realistic: financial capital, at its best, can deliver market returns. But with human capital, the sky’s the limit. Your earnings, your productivity, and your ability to adapt are only as limited as your imagination. Asset managers may promise growth, but human capital has far more potential to create wealth and security, especially as we live longer, healthier lives.
It’s time to think about your future in a more holistic way. Yes, your savings matter, but so does your ability to remain active, engaged, and productive. Investing in yourself—your skills, your well-being, your capacity to earn for longer—is the most valuable investment you can make.
We need to reframe the conversation. It’s not just about building a pension pot; it’s about building yourself. Imagine how much more secure you could feel if you’re still generating income and doing meaningful work well into your 60s, 70s, or even beyond.
What we really need is a Human Capital Awareness Week. Because while financial capital has its place, it’s your human capital—your vitality, creativity, and productivity—that will truly define your financial future. Think about the future you, and invest in yourself—not just in your pension.
This shift in thinking can make all the difference in ensuring not only a secure retirement but a fulfilling, active, and empowered life well into your later years.
Questions & Answers
Q: What is human capital, and why is it important for my financial future?
A: Human capital refers to your skills, experience, health, energy, and ability to earn. It’s everything you bring to the table that allows you to stay productive and continue generating income. Human capital is a key part of financial longevity because it doesn’t just stop when you reach retirement age. If you invest in your health, knowledge, and ability to keep working, you can continue creating value well into your later years. This makes human capital just as important—if not more so—than financial savings when it comes to building long-term wealth.
Q: How does human capital compare to financial capital in terms of building wealth?
A: Financial capital, such as savings and investments, can grow over time, but it’s limited by market returns. Human capital, on the other hand, has the potential to grow exponentially. Your ability to keep earning, learning, and being productive can make a huge difference to your overall wealth. Think of it this way: financial capital gives you a safety net, but human capital gives you the opportunity to keep climbing higher. The sky’s the limit when you invest in yourself.
Q: Why doesn’t the Nutmeg study focus on human capital?
A: The study focuses on traditional financial measures like pension contributions and investment tracking, but it overlooks the value of human capital—your capacity to keep earning and being productive. This might be because many financial advisers and asset managers tend to focus on managing your savings rather than helping you develop your human potential. The omission of human capital in the study is significant because it ignores a huge part of what contributes to your overall financial well-being.
Q: How can I start investing in my human capital?
A: Investing in your human capital starts with taking care of your health, developing your skills, and staying engaged in meaningful activities. This could mean pursuing further education, starting a new career or project, or simply maintaining your well-being through exercise and mental health practices. The goal is to ensure that you remain productive and capable of earning for as long as possible, which adds resilience and flexibility to your financial future.
Q: Isn’t financial planning all about saving for retirement?
A: While saving for retirement is an important part of financial planning, it’s not the whole story. This type of financial planning focuses on saving money you have already made. True financial planning looks at your total wealth, which includes both your financial capital (savings, investments) and your human capital (your ability to earn and be productive). By focusing only on pension pots, you might miss out on opportunities to continue generating income later in life. A well-rounded plan should help you manage both your savings and your capacity to keep working and earning.
Q: What is the best way to balance human capital and financial capital?
A: The best way to balance the two is to treat them as complementary. While it’s important to save and invest for the future, it’s equally important to invest in yourself—your skills, health, and well-being. This ensures that you have both the financial resources and the capacity to continue contributing, earning, and enjoying life. By focusing on both, you create a more secure and fulfilling future.
Q: Why do you suggest a Human Capital Awareness Week?
A: Right now, a lot of the focus is on building pension pots and financial savings, but we believe it’s time to highlight the importance of human capital. A Human Capital Awareness Week would encourage people to think about their long-term potential—how they can continue earning, learning, and being productive as they age. It’s about valuing your ability to create wealth through your own skills and energy, not just through savings.
These Q&As aim to guide readers to see the importance of human capital in their overall financial planning and empower them to take a more active role in shaping their financial future.
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